Student-loan borrowers thought they had 90 days to find a new repayment plan. That timeline is shifting.
More student-loan borrowers are receiving notices that they have an extra 30 days to leave the SAVE repayment plan, extending the transition deadline.
The U.S. Department of Education is extending the deadline for student-loan borrowers to switch repayment plans, amid concerns about increasing monthly payments. Initially set for September 29, the deadline has been pushed back to October 29, providing borrowers with an additional month to choose a new plan. This shift comes after the Trump administration terminated the SAVE income-driven repayment plan, which had been in place under the Biden administration, and began notifying borrowers of their 90-day window to select an alternate plan.
Research from the JPMorgan Chase Institute indicates that borrowers who remain on a standard repayment plan may face payments that could be up to 12% of their income, significantly higher than the 3% of take-home income currently required under the SAVE plan. With over 7 million borrowers enrolled in the SAVE plan, the extension aims to alleviate the potential financial strain and reduce the risk of default, which currently stands at 9.3 million borrowers as of June 30, with another 1.5 million at risk in the next six months.
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